Steel Dynamics(STLD) - 2025 Q3 - Quarterly Results

Press Release Overview This section summarizes Steel Dynamics' strong Q3 2025 financial and operational performance and CEO commentary Third Quarter 2025 Performance Highlights Steel Dynamics reported strong third quarter 2025 financial results, with significant increases in net sales and net income compared to both the sequential and prior year quarters, alongside record steel shipments and successful advancements in aluminum and biocarbon production | Metric | Q3 2025 | Q2 2025 (Sequential) | Q3 2024 (Prior Year) | | :-------------------- | :------ | :------------------- | :------------------- | | Net Sales | $4.8 billion | - | - | | Net Income | $404 million | $299 million | $318 million | | Diluted EPS | $2.74 | $2.01 | $2.05 | - Achieved record steel shipments of 3.6 million tons[5][6] | Metric | Q3 2025 (in millions) | | :--------------------- | :-------------------- | | Adjusted EBITDA | $664 | | Cash Flow from Operations | $723 | | Liquidity | >$2,200 | | Share Repurchases | $210 (1.1% of shares) | - Successfully produced and qualified industrial, beverage can, and automotive quality flat rolled aluminum products[4][6] - Successfully produced and consumed biocarbon material, providing a significantly lower-carbon supply chain for steel customers[4][6] CEO Commentary CEO Mark D. Millett highlighted exceptional Q3 performance, strong financial results, and operational milestones, emphasizing the success of aluminum and biocarbon initiatives, record steel shipments, and positive market demand drivers despite some customer inventory overhang - Consolidated third quarter 2025 operating income improved 33 percent and adjusted EBITDA increased 24 percent sequentially[3] - Achieved a three-year after-tax return-on-invested capital of 15 percent, reflecting a high-return capital allocation strategy[3] - Aluminum and biocarbon teams are performing incredibly well, with products qualified by customers and first biocarbon successfully used as a carbon replacement[4] - Record quarterly steel shipments were achieved as imports declined and Sinton's performance improved, though some customer inventory overhang of value-added flat rolled products persists[5] - Encouraging demand drivers include manufacturing onshoring, infrastructure program funding, lower interest rates, and increasing regionalization of supply chains in the U.S[5] Third Quarter 2025 Detailed Performance This section details the company's Q3 2025 performance across its steel, metals recycling, and fabrication operations, and its financial position Steel Operations Steel operations experienced a 30% sequential increase in operating income, driven by record shipments and metal spread expansion, as scrap costs declined more than steel selling values. Demand was strong across key sectors, but Q4 production may be impacted by scheduled maintenance - Operating income for steel operations was $498 million, 30% higher than sequential second quarter results[7] - Increase in operating income was due to record steel shipments and metal spread expansion, as scrap raw material costs declined more than average realized steel selling values[7] | Metric | Q3 2025 | Sequential Change | | :-------------------------- | :----------- | :---------------- | | Average External Selling Price | $1,119 per ton | -$15 per ton | | Average Ferrous Scrap Cost | $381 per ton | -$27 per ton | - Demand was led by the energy, non-residential construction, automotive, and industrial sectors[7] - Normal maintenance outages are scheduled for Q4 2025 at Butler, Columbus, and Sinton Flat Roll Steel divisions, potentially reducing production by up to 85,000 tons[8] Metals Recycling Operations Metals recycling operations saw a sequential increase in operating income, attributed to near-record ferrous scrap shipments and improved metal spread - Operating income from metals recycling operations was $32 million, $10 million higher than sequential earnings[8] - Improved performance was based on near-record ferrous scrap shipments and metal spread expansion[8] Steel Fabrication Operations Steel fabrication operations reported higher operating income in Q3 2025, driven by a 12% increase in shipments. Order activity remained steady, maintaining a solid backlog extending through the first quarter of 2026, with future demand expected to be supported by domestic manufacturing and infrastructure programs - Operating income for steel fabrication operations was $107 million, higher than sequential second quarter results of $93 million[9] - The increase was due to a twelve percent increase in shipments[9] - Order activity remained steady, with the order backlog maintaining solid levels extending through the first quarter 2026, supported by stable pricing[9] - Demand was largely driven by the commercial, data center, manufacturing, warehouse, and healthcare sectors[9] Financial Position and Capital Allocation (Q3) The company generated substantial cash flow from operations in Q3 2025, which supported capital investments, dividend payments, and share repurchases, while maintaining robust liquidity | Metric (in millions) | Q3 2025 | | :------------------- | :------ | | Cash Flow from Operations | $723 | | Capital Investments | $166 | | Cash Dividends Paid | $74 | | Share Repurchases | $210 | | Liquidity (as of Sep 30, 2025) | $2,200 | - Share repurchases represented 1.1 percent of outstanding shares[10] Year-to-Date September 30, 2025 Comparison This section compares the company's year-to-date financial and segment performance as of September 30, 2025, against the prior year, detailing capital allocation Consolidated Financial Performance (YTD) For the first nine months of 2025, net sales remained stable year-over-year, but net income and operating income saw declines, primarily due to lower realized pricing in the steel and steel fabrication segments | Metric (in millions, except per share) | YTD Sep 30, 2025 | YTD Sep 30, 2024 | YoY Change (%) | | :------------------------------------ | :--------------- | :--------------- | :------------- | | Net Sales | $13,800 | $13,700 | +0.7% | | Net Income | $920 | $1,300 | -29.2% | | Diluted EPS | $6.17 | $8.46 | -27.1% | - Operating income declined 32 percent to $1.2 billion in the first nine months of 2025 compared to $1.7 billion in the same period of 2024[12] - Decreased earnings were primarily the result of lower realized pricing in the company's steel and steel fabrication operations[12] Segment Performance (YTD) Year-to-date operating income for both steel and steel fabrication operations decreased significantly, reflecting lower average external selling prices for steel, while ferrous scrap costs remained stable | Segment Operating Income (in millions) | YTD Sep 30, 2025 | YTD Sep 30, 2024 | YoY Change (%) | | :------------------------------------ | :--------------- | :--------------- | :------------- | | Steel Operations | $1,100 | $1,400 | -21.4% | | Steel Fabrication Operations | $317 | $525 | -39.6% | | Metric (per ton) | YTD Sep 30, 2025 | YTD Sep 30, 2024 | YoY Change | | :-------------------------------- | :--------------- | :--------------- | :--------- | | Average External Steel Selling Price | $1,083 | $1,133 | -$50 | | Average Ferrous Scrap Cost | $391 | $391 | Stable | Financial Position and Capital Allocation (YTD) The company generated strong cash flow from operations year-to-date, enabling substantial capital investments, debt repayment, dividend distributions, and share repurchases, while maintaining consistent liquidity | Metric (in millions) | YTD Sep 30, 2025 | | :------------------- | :--------------- | | Cash Flow from Operations | $1,200 | | Capital Investments | $760 | | Senior Notes Repaid | $400 | | Cash Dividends Paid | $218 |